April 3, 2017

April 3, 2017
FOR IMMEDIATE RELEASE

UA President calls new cuts to budget devastating
Senate cuts $22 million from university budget, phases out Alaska Performance Scholarship and cancels U-Med access road project

FAIRBANKS – Actions taken by the Alaska Senate today, if enacted into law, could have a detrimental impact on the University of Alaska. The Senate Finance Committee revealed a new version of the FY18 Operating Budget that would cut $22 million from the university, $5.7 million in a new cut announced today in addition to the $16.3 million cut the Senate previously proposed. The Senate’s budget proposal would result in a $75 million (19.8 percent) cut over the last four years. The finance committee also proposed to eliminate $17 million for the U-Med Northern Access project, a north-south road linking Elmore Road to Bragaw Street at Northern Lights Boulevard in Anchorage that would improve safe access to important education and health facilities. Today’s decision effectively ends state funding for this critical transportation project and makes it unlikely the project will progress in the near term.

In separate action today, the Senate Finance Committee introduced SB 103, which would eliminate the very successful Alaska Performance Scholarship program within the next four years.

“These legislative cuts and the impact they will have on the university are devastating,” said University of Alaska President Jim Johnsen, “especially after we’ve shown lawmakers that we have a plan to gradually reduce our reliance on state general funds. But we need time to implement that plan and to continue to create the kind of university this state needs. In addition, we are in the midst of making major organizational changes to ensure wide access to affordable and high quality programs for our students.

The university’s budget has been cut $53 million over the past three years resulting in the loss of 927 employees, 50 programs and other major cutbacks. Johnsen has shown legislators how plans now underway would reduce the university’s reliance on state funds by 2025. “We are building the kind of university the state needs to meet a changing workforce and our economic future,” he said.

SB 103 would shift the Alaska Performance Scholarship (APS) into a program to fund competitive innovation grants within Alaska’s school districts. The APS would be phased out by the 2020-2021 academic year. The Alaska legislature enacted the Alaska Performance Scholarship in 2012 to inspire the state’s high school students to prepare for and succeed in post-secondary education. The APS has incentivized Alaskan students to better prepare for college and it has increased enrollment at UA.

“We are extremely concerned about any change that would impact the successful APS program,” Johnsen said. “We believe ending the program would be very detrimental to growing our enrollment, incentivizing young Alaskan’s to remain in-state for college and then joining Alaska’s workforce.”

Since its inception, 14,674 Alaska high school graduates have completed the requirements and become eligible for APS scholarships. Of that number, 5155 students have enrolled in and attended the University of Alaska on the scholarship. Cutting the scholarship program could impact UA’s bottom line by as much as $10 million annually, on top of other cuts under consideration.

Of the move to cut the U-Med road, Johnsen said: “This district is home to several of the largest employers in the state and one of the bright spots of Alaska’s economy. The healthcare sector is growing, and the high concentration of research, science and medical facilities in the U-Med District provide a tremendous economic opportunity for our state. Unfortunately, the surrounding transportation infrastructure hasn’t kept up with the area’s growth and is now impacting the safety, vitality and economic potential of the area.”

The University’s Board of Regents has called a special meeting on April 13 to receive an update on the budget situation and to discuss contingency planning.

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For more information, contact Roberta Graham, associate vice president of public affairs at 907-360-2416 (cell).

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